Bankim Chadha, head US equity and global strategist at Deutsche Bank spoke on Bloomberg TV on Monday. He expects a near term SPX rally due to:
- Stronger-than-expected Q1 earnings
- There's this narrative out there that the bottom of consensus is forecasting the worst earnings season ever and down 7%. I think they should be careful with that hypothetical because the earnings beat is almost always by 5%.
- A weakening US dollar.
- We had upgrades to growth in the US, in Europe, in China, in Japan. We had the dollar come down. All of that argues basically for upside or a rebound in earnings from the boost to US firms' dales
Projects the S&P 500 above 4250.
Chadha does provide a caveat:
- there is considerable uncertainty for the market moving forward ... says the US economy could either start growing or "suddenly crash"
---
I posted bearish views earlier:
- JP Morgan Kolanovic says even a mild recession could cause US stocks to fall by 15%
- Morgan Stanley on US Stocks - "we are far from out of the woods with this bear market"
---
